Time Machine suddenly stopped backing up due to an encryption error — iMac 24-inch, macOS 27.0
That sounds really frustrating, especially when everything was working perfectly yesterday. The good news is that this error does not necessarily mean your backups are lost or that the drive has suddenly become unencrypted.
We first need to establish whether the problem lies with macOS, the backup drive, its encryption settings, or the connection.
The most important thing is not to erase, reformat or initialize the backup disk. Your existing backups may still be intact, so let us avoid doing anything that could put them at risk.
Start with the exact error message
If possible, write down the full error message or take a screenshot. There Is an important difference between Time Machine reporting that encryption is disabled and saying that an existing backup cannot be encrypted, unlocked or accessed.
Each points towards a different possible cause.
If Time Machine settings will not open or respond
Try restarting your iMac normally, then open Apple menu >> System Settings >> General >> Time Machine again.
If System Settings itself has frozen, press Option–Command–Esc, select System Settings and choose Force Quit. Reopen it and try again.
If the settings still will not open, do not keep attempting to change the encryption settings. Make a note of the problem and include it when contacting Apple Support.
Check the backup drive or network connection
If you are ‘using an external USB or Thunderbolt drive, check that its power and cable connections are secure and connect it directly to the iMac rather than through a hub, if possible.
If the drive is visible in Finder and Time Machine is not backing up, you can try ejecting it through Finder. If it ejects successfully, disconnect it, restart the Mac and reconnect it once macOS has loaded. If it will not eject, is not visible or appears to be active, do not force it or unplug it.
If you are backing up to a NAS or network drive, check that the device is switched on, the network connection is working and the backup destination is accessible. Do not physically disconnect a network device as part of this step.
Check Disk Utility
Open Applications >> Utilities >> Disk Utility, then choose View >> Show All Devices.
Check whether the backup disk appears and whether any errors are reported. You can inspect its status without erasing it. If the disk appears damaged or is repeatedly disconnecting, stop before attempting repairs that could affect your existing backups.
Check the encryption password and disk format
If macOS asks for the backup password, try the original password. You can also open Keychain Access and search for the backup disk's name to see whether a saved password entry exists.
The disk's format may also be relevant. Apple supports several formats for Time Machine, including APFS and certain Mac OS Extended formats. Knowing which format the existing backup uses may help identify the cause, but the error alone doesn't establish that the format is the problem.
Avoid switching encryption off and on, removing and re-adding the backup destination, or starting a new backup setup until the existing backup has been assessed. Depending on the destination and the operation, you could lose the previous backups.
Check for macOS updates
Your post specifies macOS 27.0 on an iMac 24-inch. Check System Settings >> General >> Software Update for any available updates, particularly if the problem began after a restart or software update.
This does not mean macOS is necessarily responsible, but the timing may help Apple Support diagnose the issue.
Apple's official troubleshooting guidance is available here:
If the problem persists and you cannot access Time Machine settings, I would contact Apple Support before attempting any more drastic remedies.